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AT THIS HOUR WITH BERMAN AND MICHAELA

Trump/Cruz Battle in Debate; Lindsey Graham Endorses Jeb Bush; Dow Plunges 300-Plus Points from Open; Detained U.S. Sailors Altered Planned Course; N.Y. Rep. Peter King Responds to Cruz Remarks. Aired 11-11:30a ET

Aired January 15, 2016 - 11:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


(COMMERCIAL BREAK)

[11:00:21] KATE BOLDUAN, CNN ANCHOR: Hello, everyone. I'm Kate Bolduan.

JOHN BERMAN, CNN ANCHOR: And I'm John Berman.

Happening now, the morning after, Donald Trump in Iowa for his first event since the debate last night. We're waiting for this town meeting to begin any minute. You're looking at Living History Farms, it's an open-air museum in Urbandale, Iowa.

BOLDUAN: The Republican front runner fresh off the debate stage, where the gloves came off between Donald Trump and the other Republican front runner in Iowa. Ted Cruz with two and a half weeks between now and the Iowa caucuses. That brief bromance between the two is dead. If there's a stronger word than "dead," it's that as well.

Let's got to Jim Acosta. He is live at the Trump town hall.

Jim, what are you hearing there? What are you expecting to hear from Donald Trump?

JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: Good morning, guys. This is a very interesting Donald Trump rally. This is a window into where his campaign is right now. You're use to seeing Donald Trump playing to those big crowds and arenas. Check out the setting behind me. It's very small and intimate. There's only a couple hundred people in here. That's essentially what Donald Trump needs to do right now. It's two weeks- plus to the Iowa caucuses. He needs to get on the ground and do the retail politicking crucial in the final stages of process.

We heard just before Donald Trump is set to take the stage here, one of his supporters trying to fire up the crowd here. She's explaining to voters in Iowa how to go to the caucus on caucus night and how to make sure that they go ahead and register as Republicans before they show up on caucus night. That's the illustrations and obviously, one of the concerns inside the Donald Trump campaign. That is he does so well in the polls and arriving high but can he get people to the caucus locations? That's interesting to watch. Another thing that's interesting just a few minutes ago, there was a

gentleman who described himself as a former deputy sheriff shot by an illegal immigrant and the gentleman here in a wheelchair telling that story. The crowd behind me is fairly noisy right now and was dead quiet and listening to every word he had to say. That gives you an indication as to who shows up at the rallies. We heard a taste of that as well.

John and Kate, what I think is going to be interesting to watch here in the next few minutes is whether or not Donald Trump goes right after Ted Cruz once again. We saw the two candidates clash over the issue of Ted Cruz's citizenship and whether he's eligible to be president of the United States and the clash over New York values.

Donald Trump was warming up on Twitter earlier this morning laying into Lindsey Graham's endorsement of Jeb Bush. Donald Trump tweeted just a little while ago, "That means nothing for Jeb Bush because Lindsey Graham was getting zero in the polls."

Guys, back to you.

BOLDUAN: Donald Trump doesn't miss than opportunity to take on Lindsey Graham even after he leaves the race.

Jim, great to see you. We're going to take it to you live when Donald Trump begins to speak.

Let's take a look at more about how last night's debate and bromance between Donald Trump and Ted Cruz may effect the Republican presidential race from here on out.

Here to talk about it, CNN political commentator and Democratic strategist, Hilary Rosen; chief political correspondent for USA Radio Network, Scottie Hughes, a Trump supporter; and Barry Bennett, Ben Carson's former campaign manager, a long-time Republican strategist.

BOLDUAN: I got far more sleep than you and you do it better than me.

(CROSSTALK)

(LAUGHTER)

BERMAN: Scottie, I want to start out with you.

Last night was the worst night for the rest of their lives for Ted Cruz and Donald Trump. They've been friendly but now not so much. The issue of Ted Cruz's birth. He was born in Canada and he defended himself vigorously. Let's watch.

(BEGIN VIDEO CLIP)

SEN. TED CRUZ, (R), TEXAS & PRESIDENTIAL CANDIDATE: Back in September, my friend, Donald, said that he had had his lawyers look at this from every which way and there was no issue there, nothing to this birther issue.

(LAUGHTER)

Now, since September, the Constitution hasn't changed.

(LAUGHTER)

But the poll numbers have.

(LAUGHTER)

(END VIDEO CLIP)

BERMAN: A lot of people we've heard from seemed to think Ted Cruz got the better end of this discussion, Scottie, what do you think?

SCOTTIE HUGHES, CNN CONTRIBUTOR & CHIEF POLITICAL CORRESPONDENT FOR USA RADIO NETWORK: I think both men had great points last night and great lines. You're seeing those have tractions and headlines today. I think going forward, both of these men could have gone a lot harder and deeper and gone for the jugular for each other but I think the wounds were official and on the bitter scale they've eliminated this issue from coming up in the future. Either one of these guys will possibly be the Republican nominee. And it's going to be hard for the Democrats to bring out anything against either one of them that has not already been brought up. It will be old news.

[11:05:21] BOLDUAN: Barry, what do you think? Do you think those are superficial wounds last night? Do you think now the citizenship issue is taken off the table?

BARRY BENNETT, FORMER BEN CARSON CAMPAIGN MANAGER: No. No one's going to let it die. Donald Trump don't need to bring it up. The Democrats will I assure you. The two of them sucked up most of the energy and time. They were the big winners.

She's right. One of them will be the nominee and I think at this point, mathematics tells me it's going to be Trump but it will be interesting to watch the next three weeks.

BERMAN: If you take all the time, there's not much else to talk about.

Hilary, I want to discuss another key moment between the two men, this idea of New York values. Ted Cruz has accused Donald Trump after having New York values. I want you to listen how Donald Trump responded. He was emotional.

(BEGIN VIDEO CLIP)

DONALD TRUMP, (R), PRESIDENTIAL CANDIDATE & CEO, TRUMP ORGANIZATION: We rebuilt downtown Manhattan and everybody in the world watched and everybody in the world loved New York and loved New Yorkers and I have to tell you, that was a very insulting statement that Ted made.

(APPLAUSE)

BERMAN: So, Hilary, did Ted Cruz do what a lot of people thought was impossible? Did he make Trump a sympathetic figure?

HILARY ROSEN, CNN POLITICAL COMMENTATOR: I think he's been doing that the last several days. It's ironic. Only Ted Cruz could make Donald Trump seem warmer and fuzzier, what comes out of his mouth matches what comes out of Trump's mouth. Cruz is more articulate with it. The amazing thing is these two people who both of their sense of values is demonizing immigrants and lesbians or women's issues or planned parent hood, whatever it is, their entire campaign has been about creating divisions and antagonism. The fact that these two are now so far ahead of other candidates is really amazing and you know, I think Democrats are sort of sitting back thinking, my god, you know, running against right one of them are going to show America the most stark choice on values, on what real values are.

BOLDUAN: Now, Scottie, Donald Trump wasn't the only person taking on Ted Cruz last night. Marco Rubio helped out in that venture for sure. His long list of attacks came late in the debate. Here's a little taste.

(BEGIN VIDEO CLIP)

SEN. MARCO RUBIO, (R), FLORIDA & PRESIDENTIAL CANDIDATE: Ted Cruz, you use to say you supported doubling the number of green cards, now you say you're against it. You use to support a 500 percent increase in the number of guest workers. Now you're against it. You used to support legalizing people here illegally. Now you're against it. You were against birth right citizenship. Now you're against it.

(END VIDEO CLIP)

BOLDUAN: Scottie, you're a Trump supporter. Did Marco Rubio help you guys out last night?

HUGHES: No. What Rubio did was accomplish what he was out to do was separate himself and his agenda and what he's accomplished to Ted Cruz. They're both buying for the number two spot to go one on one with Donald Trump. Marco Rubio did that. He showed the opposite ends. That was exactly what Marco wanted to do and he accomplished that. On the other hand, this gave Ted Cruz more ammunition to show everybody had their daggers aimed at me. That means I'm taking on the Republican establishment and the media and that helps Ted Cruz. Across the board, all three men accomplished their goals going into last night's debate.

ROSEN: I'm not sure about that. I'm puzzled by Marco Rubio's strategy. He seems to be trying to go after Ted Cruz's supporters where, by the way, those are strict evangelicals. He's not going to get them. He's better off being the alternative in many respects to Donald Trump if that support falls away. He is more of an establishment attractive player and so I don't understand why he keeps thinking that going after Cruz is going to help him. He ought to be trying to solidify the Bush, Kasich, Trump hand-offs, all of those voters, and it makes no sense to me. He's put himself in a place where he has nowhere to go.

(CROSSTALK) [11:10:04] BERMAN: Hang on one second. We have news that gets to that point, this establishment lane. Just a few minutes ago, there was an endorsement. Lindsey Graham, the Senator from South Carolina, endorsed establishment candidate Jeb Bush for president.

Listen to Lindsey Graham.

(BEGIN VIDEO CLIP)

SEN. LINDSEY GRAHAM, (R), SOUTH CAROLINA: Last night, he did not talk the most but he made the most sense. Last night, he demonstrated somebody who, in my view, is ready on day one to be commander-in- chief.

(END VIDEO CLIP)

BERMAN: Barry, address the endorsement. Does this make a difference? Also address this establishment battle that Hilary was just talking about.

BENNETT: I don't know that it makes a big difference outside the state of South Carolina but inside the state I think it matters. Marco Rubio is counting on winning in South Carolina and he just made it tougher for him. If the establishment lane can't narrow, can't come down to one or two guys, they're going to lose. Lindsey Graham did this morning perpetuated the battle four to six weeks, which it's probably too late.

(CROSSTALK)

BERMAN: Last word to Scottie.

HUGHES: It was the best news for Ted Cruz and Donald Trump. South Carolina is not a win-or-take-all. It's a win-or-take-all in the district. It splits the votes between the establishment, Marco Rubio, Jeb Bush, that allows conservatives like Ted Cruz and Donald Trump to be able to get a piece of the pie.

BERMAN: Man, oh, man, thinking the long game there. Some inside strategy.

Scottie Hughes, Hilary Rosen, Barry Bennett, great to talk to you. Thanks so much.

BOLDUAN: Thanks, guys.

New Yorkers furious at Ted Cruz. We'll speak live with one of his Republican colleagues, outspoken New York Congressman Peter King, who makes no secret for his feelings against Cruz.

BERMAN: Plus, the world's preeminent Republican debate coach joins us live and grades the candidates' performances. Who delivered, who debacled? If that's a word.

And Sean Penn speaks out for the first time with his controversial interview with el Chapo. He's not only angry, hear why he says he's now at risk.

(COMMERCIAL BREAK)

[11:16:34] BERMAN: Breaking news. Ew. That is the sound coming from Wall Street. The Dow is down nearly 400 points so far. 375 points so far. It is on track for the worse month period since 2009.

BOLDUAN: Take a look at this big board.

Chief business correspondent, Christine Romans, is here as we're looking at it.

It's down and slightly back up. Going to go back down probably.

CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: It's fear. Fear spreading around the world. Today, the reason there's more fear is what's happening in the oil market. Oil is down 8 percent. Steep drop in oil this month and that decline continues. Look at oil prices a year and a half ago. They're down 70 something percent. That's a good thing action right. You put it in your tank and take all this money and spend it in the economy.

BERMAN: I feel like there's a "but" coming up.

ROMANS: But too much of a good thing is a bad thing. That's because the countries are in free fall, essentially. Currencies are being pressured. China is a big consumer of oil, largest imported oil. You add this together and there's concerns about the financial markets and ramifications of destabilization.

So it's good for drivers. Good for American consumers. Now, we're worried about slowing China and this drop, this crash in oil prices is going to hurt what is a stable U.S. economy.

BOLDUAN: The problems in China sure don't seem like a quick fix or its going to get better any time soon. What are we going to do?

ROMANS: When you look at China, rapidly growing GDP growth, maybe it's growing 5 percent, 6 percent, 7 percent. That sounds good but it's a slow down in the economy. Concerns about the transparency, concerns about the rather small stock market there. People in China are exposed to the stock market. We've seen crazy stock markets there. All that is feeding into the fear of how will China affect the rest of the world. On the front page of the "Wall Street Journal" this morning, sort of summed up all the angst in the global market. The U.S. economy is relative strong and stable. It's the healthiest in the neighborhood. But will these other problems around the world, will they knock on our door, and how soon?

BERMAN: Increasingly lonely island as we see the market dropping.

Christine Romans, tough start to the New Year.

ROMANS: Yes, it sure is.

BOLDUAN: Also more breaking news. According to the U.S. defense officials before the sailors drifted in Iranian water and were detained by Iran, they had changed course.

BERMAN: This is new information just coming in to our Pentagon correspondent, Barbara Starr, at the Pentagon.

Barbara, what are you learning? This changes the picture a little bit.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: It does. Good morning. This is all under investigation. The 10 sailors are being debriefed. The Pentagon still putting the pieces together. All of this could change at the end of the day in some fashion. But two defense officials tell me that the latest information indicates, at some point before they wound up in Iranian waters, the crew made the decision to alter course. They were supposed to go basically up the middle of the Persian Gulf on their transit and stay in international waters, no problem. For some reason that is not clear yet, they decided to alter course. They wind up in Iranian waters.

What we don't know at this point yet is, did that course take them into Iran and they did not realize it, or did something go wrong with their GPS and they drifted further and they wound up in Iran?

[11:20:17] What is increasingly becoming clear, according to defense officials, is the crew made a series of decisions. This was one of them. And as they were experience what we know now as engine trouble, they were focused on trying to fix their mechanical problem and didn't perhaps put their heads up, look around and see where they were. Apparently, the indications are it caught them quiet by surprise they were in Iranian waters.

So the crew making a series of decisions not the best. Again, we have the emphasize all of this still under investigation. No firm conclusions yet.

BOLDUAN: Which means this could be changes but this is interesting details and developments you're picking up from your sources.

Barbara, thank you so much. Great to see you.

STARR: Sure thing.

BOLDUAN: Coming up, one of the most outspoken members of Congress, who also happens to be a New York native, joins us live to respond and discuss Ted Cruz's comments about New York values. Republican Congressman Peter King coming up next.

Plus, is Sean Penn fearing for his life? New this morning, the actor breaks his silence. Why he says he's in the cross hairs plus Donald Trump set to take the stage any minute. We're watching it live and we'll take you there.

(COMMERCIAL BREAK)

[11:25:51] BERMAN: All right. Happening now, you're looking at live pictures from Iowa where Donald Trump is about to take the stage, first event since the debate last night. A debate where we saw something different with Donald Trump and Ted Cruz going after each other on issues where Ted Cruz was born and Cruz saying Donald Trump has New York values.

BOLDUAN: Bromance no more.

BERMAN: Exactly. Now Trump says Cruz has offended 20 million people with his claim of New York values. "New York News" was more blunt than that. Look at the cover. It says, "Drop dead, Ted. Go back to Canada." Not a lot of subtlety there. See the Statue of Liberty. Adding a special side gift.

BOLDUAN: What did Ted Cruz mean by New York values? He explained himself and Donald Trump responded.

(BEGIN VIDEO CLIP)

CRUZ: Everyone understands that the values in New York City are socially liberal or pro abortion or pro gay marriage focused around money and the media.

TRUMP: New York is a great place and it's got great people and loving people and wonderful people. When the World Trade Center came down, I saw something that no place on earth could have handled more beautifully, more humanely than New York.

(END VIDEO CLIP)

BOLDUAN: Let's talk more about this with a Manhattan-born, Queens- raised Congressman who now represents parts of Long Island, Congressman Peter King.

Congressman, great to see you. Thanks for coming in.

REP. PETER KING, (R), NEW YORK: Thank you, Kate. Thank you very much.

BOLDUAN: So, I want to get your take on all of this. Hillary Clinton also just weighed into this New York values fight and she said this, "Just this once Donald Trump is right," she says in this tweet. "New Yorkers value hard work, diversity, tolerance, resilience and building better lives for our families."

You're a Republican, elected by the people of New York, what do you think of this?

KING: What Ted Cruz said was disgusting, hypocritical. Fro one thing, his wife works for one of the largest banks in New York. He's always coming to New York trying to raise money for Republicans, including gay Republicans, and he tells them behind closed doors and he'll look the other way on gay marriage.

But apart from that, New York, you want to say you disagree on certain issues, that's one thing. Talking about values, you're talking about the cops and firemen. We lost 400 cops and firemen on November 11th. The mayor, the governor, Democrats and Republicans came together and set the tone for the entire country in fighting back from the worst attack in our nation's history. We never backed down and faulted. That's a value you can't buy anywhere and I challenge any other place in the country to show that type of dedication and courage. That, to me, is a lasting value and American value. And what Ted Cruz forgot was on and after 9/11, all Americans said we are New Yorkers. This is not just an attack on 20 million people. We can handle ourselves. I think he hurt himself when he went after the values issue because people all over the country identify with the spirit and the bravery of what the cops and firemen and all New Yorkers showed after 9/11.

BERMAN: Congressman, you don't really think Ted Cruz was questioning the bravery of everyone in the city after September 11th, do you?

KING: He was questioning the values. I don't know of any higher values than patriotism and courage. That's the self-righteousness of Ted Cruz. If he said, hey, we had differences on certain issues, that's one thing.

But also the whole idea of patriotism. We had almost 300 men and women. You and I belong to the Fighting 69. There's four or five deployments in Iraq and Afghanistan and many casualties, fatalities. This is what New York is all about. So values is a term that really, really turned us off, really got people aggravated and angry. It's multi, right to left, Republican, Democrat, black, white, you name it, everyone was offended by that. Listen, we don't need anyone to feel sorry for us but we're not taking stuff from anybody like Ted Cruz.

BOLDUAN: You mentioned values, and that's an important thing to discuss.